Blockchain cryptography uses complex mathematical algorithms and protocols to secure and verify transactions on a decentralized, distributed ledger. At its core, it uses a combination of public and private keys to encrypt and decrypt data.
Each participant in a blockchain network is assigned a public key and a private key. The public key is freely shared with others on the network, while the private key is kept secret. When a participant wants to initiate a transaction, they use their private key to sign the transaction, creating a digital signature that verifies their identity.
Once the transaction is signed, it is broadcast to all nodes in the network and a consensus protocol is used to validate the transaction. The consensus protocol ensures that all nodes have a copy of the same ledger and that any changes to it are approved by the majority of nodes.
The digital signature created using the private key ensures that only the owner of that key can initiate a transaction and that the transaction cannot be tampered with or altered in any way. This creates a highly secure and transparent system for managing digital assets and eliminates the need for intermediaries to facilitate transactions.
